CBN Says Borrowings Decline By Six Per Cent Due To Rising Interest Rate

The Central Bank of Nigeria (CBN) has revealed that outstanding consumer credit in Nigeria declined by 6.78% to N1,933.18 billion at end of June 2022, from N2,073.76 billion as of December 2021.

The CBN blamed the fall on the rising interest rates as central banks around the world raise rates to tame inflation.

This was disclosed by the CBN in its latest financial stability report published on Friday.

Meanwhile, the total credit to various sectors of the economy grew by 10.12% to N26,846.40 billion in end-June 2022, due to a 12.41% increase in credit to N14,624.15 billion in the Services Sector.

The report stated, "The decrease was due, largely, to the reduction in personal loans, owing to the rise in lending rates.

"Total credit to various sectors of the economy grew by 10.12 percent to N26,846.40 billion in end-June 2022, owing, largely, to a 12.41 percent increase in credit to N14,624.15 billion in the Services Sector.

“CBN added that credit to Agriculture and Industry increased by 11.84 and 6.87 percent to ₦1,630.38 billion and N10,591.87 billion, respectively.

"Services and Industry remained the dominant sectors, accounting for 54.47 and 39.45 percent of the total credit, respectively, compared with 53.36 and 40.66 percent in December 2021."